Hold Tata Motors, advises Phani Sekhar

Phani Sekhar, Fund Manager of Angel Broking advised to hold on Tata Motors. He also advised accumulating the stock at around Rs 250-260.

Sekhar told CNBC-TV18, “One should clearly hold on to Tata Motors. The weakness in the passenger vehicle sales or for that matter the domestic commercial vehicle sales is not news any more. We all know that there is a structural problem with the passenger vehicle portfolio and there is a general weakness in the commercial vehicle market in India, something that is unlikely to improve over the next 6-9 months.”
“But the whole Tata Motors story is riding on the back of how well Jaguar Land Rover (JLR) is doing in emerging markets, especially China and with sales in that market continuing to match market expectations. There is no reason to believe that Tata Motors would under perform the market or for that matter lose investors interest. So from this point on I don’t think Tata Motors may greatly outperform, but at the same time you might look at around 10-12 percent kind of absolute return over the year end. So if the investor has a longer term horizon, he can actually think of even accumulating the stock if it comes to levels closer to Rs 250 or Rs 260,” Sekhar added.